“The core competency that you have to have is coordinating care, specifically as it relates to chronic disease, because that is how you’re going to be paid. You’re going to get paid on a global, capitated basis. We think that’s probably the end game for replacement for fee for service,” Leaver says.
Many organizations will pursue a course such as Iowa’s and forego ownership of each piece of the care continuum. But doing so creates a need to build strong relationships with care partners and affiliated physicians.
“You’ve got to put a different level of importance on downstream providers that you probably took for granted in the past—that will be very strategically important in the future,” says Kathy Love, CEO of Clark Regional Medical Center, a 79-staffed-bed community hospital in Winchester, KY.
A strong physician integration model and built-in performance bonuses for meeting key outcomes metrics will not only attract physicians but will also ensure both the hospital and physician are reimbursed at the highest possible rates.
But it’s hard to incentivize physicians who are not employed, Love adds. And government regulations make it difficult to be entrepreneurial and find creative solutions to affect costs and outcomes.
“Our hands are really tied,” she says. Regulations are in place for good reason—and Love does not advocate that hospitals ever be allowed to pay for referrals. “We’ve done a good job with setting quality and core measures. Eventually we’re getting paid for that,” she says. But unless physicians can share in the incentives, disincentives, cost control, and profit sharing, it will be difficult to change physician behaviors that affect those measures.
“If we are going to affect cost and quality, the federal government has to put some models in place to ensure compliance against fraud but allow tighter collaboration without employment,” she says. “They have to give us the room to do it … if we’re going to achieve the outcomes that our nation demands.”